THE BUSINESS BOOMER – #6b – Performance Reviews: 10 Reasons Why They Are Necessary

As I often echo myself, common sense applies even with performance reviews.  There is no hard and fast rule of thumb as to what point a business should use performance reviews.  Is it practical for a business of 6 employees or should the minimum be ten?  Generally speaking, performance reviews are typically found with corporations with hundreds, if not thousands, of employees.  The idea here is that you want the performance review to be an effective tool.. not fluff.  If you have six employees, giving performance reviews might be impractical given all the employees may operate closely with each other, having greater contact and feedback on a more regular basis, and fostering more intimate workplace relationships.  It can get a little awkward giving a review to a subordinate who is more of a work buddy.  My own impression would be to consider giving formal performance reviews if your employee number reaches 15 – 20.

Ok.. here’s a list of ten reasons you need to give performance reviews… and remember, these are not in any order of importance.

1.   For a company the process tends to formalize and place importance on the quality of personal productivity; recognizing that an employee is human and a company asset that requires continued training and motivation to make the company a success.

2. Performance reviews allow a company to document personal employee achievements, recognize their personal efforts, and taking notice of improvements since the last review.

3. Performance reviews allow a company to document employee shortcomings in order to encourage improvement and/or administer disciplinary action in accordence with established policy.

4. Performance reviews provide the employee with a confidential, and private one-on-one forum with their immediate management person; neutral ground for frank discussion, both ways.

5.  Performance reviews allow the employee to aire their concerns, grievances, and personal needs in the workplace.

6.  Performance reviews allow the supervisor/manager an opportunity to review company policies, production goals, and philosophies with the employee to help minimize performance expectation confusion.

7.  Performance reviews provide both management and the employee an exchange in ideas to improve personal performance to achieve the expected goals.

8.  Performance reviews allow the employee to feel a level of participation in the overall work process, thus emphasizing a team contribution toward success.

9.  Performance reviews, if given on time, make an employee feel an important member of the team.

10.  Performance reviews communicate to the employee personal performance expectations and goals to reach for the next review, and any additional tools or training needed to help the employee reach those goals.

The reasons to give performance reviews are as important as the correct way to give the review itself.  If the management staff giving the reviews aren’t focused on the reasons for giving them then the meaning to the employee will likely be lost.


My next post in this category (THE BUSINESS BOOMER #6c) will present a list of what not to do when giving reviews.


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